• BlockFi, a bankrupt crypto lender, has conditionally received approval from the US Bankruptcy Court for its Disclosure Statement.
• The Official Committee of Unsecured Creditors have backed the proposal and it is one step closer to maximizing recoveries for creditors.
• If approved, BlockFi plans to focus on recovering funds from other defunct firms in order to maximize client recovery.
BlockFi’s Reorganization Progress
BlockFi, a bankrupt crypto lender, has announced that the US Bankruptcy Court for the District of New Jersey has conditionally approved its disclosure statement. This development is an indication that the reorganization process of BlockFi continues to make gradual progress eight months after filing a voluntary petition for relief under Chapter 11 of the United States Bankruptcy Code. Mark Renzi – BlockFi’s Chief Restructuring Officer highlighted their aim to maximize recoveries for its creditors and that this conditional approval moves them „one step closer“ to accomplishing that goal.
Support From Official Committee Of Unsecured Creditors
The Official Committee of Unsecured Creditors have expressed their support towards BlockFI’s proposal and have urged clients to vote in favor of it as they believe it provides „the best path“ to expeditiously return crypto back to clients.
Maximizing Recoveries For Clients
If the bankruptcy plan is approved, BlockFi plans on recovering funds from other defunct firms such as Alameda, FTX, 3AC, Emergent, Marex and Core Scientific in order to maximize recoveries for clients and defend against claims by third parties which could potentially dilute client ownership over assets held with BlockFI.
Strict Opposition From FTX Exchange
The proposed bankruptcy plans have met with strict opposition from disgraced crypto exchange FTX which has made claims against Blockfi who filed for bankruptcy relief last November 2020.
Overall this conditional approval granted by the US Bankruptcy Court demonstrates that the reorganization process of Blockfi is making progress and is one step closer towards maximizing recoveries for creditors if all goes according to plan